Employment developments: looking ahead to 2019

As we bid goodbye to 2018 and proceed with pace into the new year, now would be an opportune time to survey the developments that stand to impact the employment law landscape in the year ahead:

Settled Status for EU workers

As part of the government’s post-Brexit plans European workers currently living in the UK will be able to apply for settled status in 2019, allowing them to remain indefinitely following the end of the transition period in 2021. To attain settled status individuals must be able to prove they have been living in the UK for 5 years by 31 December 2020. Meanwhile, those who fail to meet this requirement can apply for temporary status, allowing them to remain until they have accrued enough residency to be granted settled status. For those who are keen to provide their EU workers with confirmation of these rights, we have created a letter outlining the UK’s settlement scheme.

Private sector organisations with 250 or more employees will again be required to publish their gender pay gap figures on 4 April 2019, whilst public organisations will need to do the same by 30 March. Although many organisations will be reporting for the second time, this year will be the true test as figures are expected to be heavily scrutinised in order to determine whether efforts to address any significant pay disparity highlighted in the previous year have been successful.

For help producing your own gender pay gap report please see our dedicated employment law resource on this topic. At the same time, 2019 may also be the year mandatory ethnicity pay gap reporting is introduced and our new page will keep you up to date with any future developments.

Increase in NMW rates

National minimum wage (NMW) rates will again increase for all workers from 1 April 2019. As part of these new rates workers aged 25 and over, and therefore eligible for the national living wage (NLW), will benefit from an increase of 4.9 per cent, with hourly rates rising from £7.82 to £8.21.

1 April 2019 will also see an increase to the lower earnings threshold and weekly pay for those who receive statutory sick pay (SSP). Individuals must receive average weekly earnings of £118 or greater to qualify for SSP which will then entitle them to payments of £94.25 per week. The statutory weekly rates for maternity, paternity, adoption and shared parental pay will also increase at this time, rising from £145.18 per week to £148.68 (or 90 per cent of the employee’s average weekly earnings if this figure is lower than the statutory rate).

Organisations will also need to review, and potentially change, the way they issue payslips in 2019 as from 6 April onwards the legal right to a payslip will be extended to include those who are recognised as ‘workers’. Furthermore, a new requirement means organisations will be obliged to include the number of hours worked on payslips for staff whose wages vary depending on the amount of time worked.

Additionally, from 6 April the minimum contributions for auto-enrolment pension schemes will increase for both employers and employees. Under these new requirements employers must contribute a minimum of 3 per cent of an eligible worker’s pre-tax salary to their pension pot, with the individual contributing 5 per cent themselves.